As Some VCs Refill, Others Are Running Out Of Gas
This article was originally published in Start Up
Life science VCs are posting strong across-the-board returns, allowing some firms to raise new funds larger than their prior vehicles. Still, the contraction that began nearly five years ago is still thwarting other firms’ efforts to press on through hard times.
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With Epizyme as a top performing biotech IPO and bluebird bio primed to go out soon, investor appetite would seem whetted for early stage biotechs on the public market. With improving overall IPO performance, these returns could again become meaningful for more than a few life science VCs.
Just this past January, CMEA was touting its upcoming eighth fund and two new partners with a string of early-stage biotech successes on their resumes. The fund is now dissolved, but one would-be CMEA 8 partner has moved on with a new asset-centric incubator.
A history of strong returns from the firm, which backs both private and public health care companies, compelled existing investors to return for a new fund. Still, Longitude retained a placement agent to find new limited partners as an “insurance policy.”